NTPC, BoB, Jubilant FoodWorks among top 4 stocks to buy based on technical charts
Abnish Kumar Sudhanshu
The week started on a flattish note, tracking muted overseas cues and back home, investors remained cautious on reforms after a hardliner politician was selected for the top job at Uttar Pradesh’s administration.
Profit booking is very likely as technical indicators such as RSI, which reached to an oversold level i.e., above 70 on daily chart after play out of near term trigger such as poll victory of BJP, GST roll out and Fed Reserve accommodative stance.
Pattern analysis of the daily chart shows that the breakout zone of 8,900 which is the 20-DMA has worked as major support zone which is likely to work here. If the Nifty slips below 9,050, Nifty is likely to find support around 20-DMA of 9,000.
Here is a list of top four stocks which investors can buy at current market price:
NTPC: BUY: Target: Rs 175; Stop Loss Rs 156
The intermediate term chart of the stock shows that it found support around its 200-DMA. It once again proved to be true as stock found support and recovered from its 200-DMA of Rs 155.
The Relative Strength Index or RSI on the daily chart stands at 46.9 and it is neutral. It does not show any failure swings or any bullish or bearish divergence.
The daily MACD is still bullish too as it trades above its signal line. Among the power generation companies, its chart shows initiation of trending bullish chart which it extended towards Rs 170 and above. One could go long on it with a stop loss placed at Rs 156.
Jubilant FoodWorks: BUY| Target Rs 1180; Stop Loss Rs 1,095
Reversing the declining trend, Jubilant FoodWorks is moving higher and higher since February 2017 and has gained almost 30 per cent from January lows.
Following a sharp recovery, it faces strong resistance at its 200-DMA of Rs 1,000 after consolidation. Intraday chart of the stock shows it is consolidating at Rs 1,100 mark and high delivery on Monday shows an uptick is on the cards. MACD is still trading above its signal line with no sign of divergence.
Bank of Baroda: BUY| Target Rs 175; Stop Loss: Rs 160
Formation of bullish spinning top shows bulls are trying to protecting the stock from further downside. The RSI on the daily chart stands at 50 and it is neutral.
Closing above its near-term DMA’s of 20 and 50 is an entry point for the aggressive traders.
Havells India: BUY| Target Rs 470; Stop Loss: Rs 435
Havells India broke out from its near-term high. It is now trending towards the Rs 470 zone which was also historical high of the stock. Formation of a higher high and higher lows on daily chart shows an absolute bullishness on the stock which is unlikely to cool down as some momentum indicator are yet to reach the oversold mark.(The author is Director & Research Head, Amrapali Aadya Trading & Investments. Views and recommendations given in this section are his own and do not represent those of Moneycontrol.com. Please consult your financial adviser before taking any position in the stock/s mentioned.)